Ayad Hassan's stall is a pitiful sight. But there were still dozens of Iraqis crowding round him today, eager to look and to buy.

Some of the most popular stalls these days at Baghdad's Thieves Market, a crowded cheap shopping district in the heart of the capital, are filled with piles of rubbish from American military bases.

Customers at Mr Hassan's stall were picking over dirty, half-empty bottles of Pepto-Bismol, bags of beef jerky, packets of cornflakes and, in strangely large numbers, dozens of used cans of anti-fungal foot powder.

Bags of rubbish from the many military bases across Iraq are taken to dumping sites, where they are pored over by families of Iraqis. They pick out the scraps that they think still have a value and sell them on to the stallholders at the market.

Mr Hassan, 22, said he pays around 150,000 dinars (£70) for a pick-up truck filled with American rubbish. Some days nothing sells, he said. But on a good day he can make up to 15,000 dinars.

"There are no jobs, and that's why we are working with this rubbish," he said. "It's just a way for us to make a living. We live from day to day. If we earn some money then we have enough to buy food that night. We have no money to invest in even the tiniest project. What else should I do? This is better than stealing cars."

The most popular items on his stall are the medicines and cosmetics, tubes of Colgate toothpaste and suntan cream, cans of deodorant and shaving foam. There is also food: packets of mocha cappuccino coffee, a spray can of Easy Cheese, an unopened tub of pancake and waffle syrup and parcels of jam and cake taken from the ubiquitous MREs (Meals Ready to Eat) that soldiers relied on during the war. They all sell for a few hundred dinars each.

"People are tired. There are no jobs, we are hungry. So where should we go?," asked Mr Hassan. "We are a tired society and we have no choice."

Many bemused shoppers were flicking through a pile of damp, torn magazines, mostly about sports and Hollywood with the occasional softcore pornography magazine. Some still carried the addresses where they had originally been delivered. A copy of Golf Digest and a Sports Illustrated both carried an address in Russellville, Arizona. A copy of Entertainment Weekly had been delivered to the headquarters of a unit in the 3rd Brigade of the 1st Armoured Division in Iraq.

But not all of the shoppers looking at the magazines were happy to see these stalls. "It makes me so upset. It is so hard to describe my feelings about this," said Mohsin Adnan, 24, a policeman on his day off. "It is against our dignity. It is hurting our pride. Why don't they burn their garbage? It is dirty and maybe it carries disease."

Next to him Khadum Sultan, a retired accountant, disagreed. "It's not the fault of the Americans. It's because of our people," he said. "There is no work so they have to collect garbage and sell it. But it's all expired, we know that."

In the market there is limited sympathy for the American military occupation. Mr Hassan the stallholder is clearly grateful for the chance to make a living. "At least the Americans are better than him," he said, referring to Saddam Hussein.

"We need them for a period of time because there is no stability," said the accountant, Mr Sultan. "But all they are giving us are promises."